Auditor General Junias Kandjeke has issued a disclaimer audit opinion for the Karasburg Town Council due to its failure to provide appropriate evidence to account for millions of dollars.
This information is contained in the council’s audit report for the financial year that ended 30 June 2020, which was availed to Nampa on Tuesday.
In the report, Kandjeke identified 19 accounting faults in the books of the council, on which he based his audit opinion.
A disclaimer opinion is given to institutions where the auditors were not able to obtain sufficient appropriate evidence for the audit.
Karasburg Town Council, among other things, understated its provision for doubtful debts by N.dollars 3.2 million.
It could also not provide the auditors with a Statement of Changes in Net Assets of cash flow and accounting policies.
In addition, documentation was not availed to support payments done for capital projects amounting to N.dollars 5 million.
During the financial year under review, the institution failed to file supporting documentation for expenditure to the tune of N.dollars 7 million.
Meanwhile, a difference amounting to over N.dollars 1 million was observed between the general ledger and payroll report.
Account receivables and value added tax were misstated with N.dollars 384 million and N.dollars 7.4 million respectively.
Additionally, there is an absence of a Financial Reporting Framework (FRF) in place and the financial statements were not prepared according the FRF.
Kandjeke found that the town council provision for bad debts was increased from N.dollars 6 million in 2019 to N.dollars 18 million in 2020, while the credit and debts policy provided to the auditors does not provide information on how provision for doubtful debts should be calculated.
“I have not been able to obtain sufficient appropriate audit evidence. Accordingly, I do not express an opinion on the financial statements,” Kandjeke is quoted as saying in the report.